Burchard was prosecuted in federal court in the Eastern District of California, which has quietly become a hub of cases against dealers from those notorious and now-shuttered Dark Web marketplaces.
According to Lauren Horwood, a spokeswoman for the US Attorney’s Office in Sacramento, one of the primary hubs of this federal judicial district, there are currently 11 Silk Road and AlphaBay-related prosecutions underway. Four of the defendants have pleaded guilty, and, of those, two have already been sentenced, while the others’ cases are still ongoing.
By comparison, the Los Angeles-based US Attorney’s Office for the Central District of California reports zero ongoing cases, despite being the most populous such district in the country. The same is true for the US Attorney for the Southern District of California, based in San Diego. The offices of the US Attorney for the Northern District of California (San Francisco) did not respond to Ars’ request for comment.
Here’s an update in those 11 cases:
US v. Daniel Summerfield
Earlier this month, Summerfield pleaded guilty to drug conspiracy charges. The Colorado man sold $40,000 worth of bitcoins to undercover federal agents at a meeting in Los Angeles facilitated by localbitcoins.com in July 2016 . Later on that summer, two more agents met Summerfield at a Starbucks in Sacramento, where they bought 170 bitcoins from him for $100,000 in cash. During this meeting, which was “recorded and monitored,” Summerfield told them that he avoids banks because it “keeps the government off your back” and that he sold around 200 pounds of marijuana a week. By November 2016, Summerfield and his co-defendant Nancy Verschuren (currently being prosecuted in federal court in Colorado) met a third time with undercover federal agents to sell 300 bitcoins for $250,000 in cash.
Summerfield is scheduled to be sentenced in federal court in Sacramento on November 30, 2017.
US v. David BurchardAs Ars reported last year, Burchard’s case highlights the difficulty of maintaining good operational security (OPSEC). Case in point: Homeland Security Investigations forensics analysts determined that Burchard’s PGP password was “asshole209“ (the numbers refer to his California area code). With that easily cracked password, all of Burchard’s encrypted communications became readable. In August 2017, Burchard pleaded guilty to selling 704 pounds of marijuana on Silk Road, AlphaBay, and Agora.
Burchard is set to be sentenced in federal court in Fresno on October 30, 2017.
US v. Emil Babadjov
Babadjov, according to his criminal complaint, is a 5’10”, 180-pound 24-year-old man from San Francisco. The naturalized American, who originally hailed from Bulgaria, was found out by John Rabaut, a Drug Enforcement Administration special agent. Rabaut began investigating the top heroin vendors on AlphaBay in January 2016. There, he found two accounts named “BTH-OVERDOSE” and “BLIME-SUB.” The latter of which had conducted around 1,700 transactions.
The DEA agent didn’t have to go far to find clues: he just looked to see what e-mail address was attached to that account. The result was babadjov@gmail.com, which in turn led to his Facebook account. With ease, Agent Rabaut also subpoenaed Coinbase and obtained more information about Babadjov’s account there and managed to find an Emil Babadjov registered with the California Department of Motor Vehicles. Rabaut subsequently bought three grams of heroin from the BLIME-SUB account on AlphaBay and had it delivered to Fresno. After the purchase was received, it tested positive for heroin and contained fentanyl as well. By matching the postal markings to the photos automatically taken by a self-service kiosk at a post office in San Francisco, Rabaut was able to match the photos to Babadjov.
Babadjov is scheduled for a status conference in federal court in Fresno on October 30, 2017.
US v. Chaudhry Ahmad Farooq / US v. Abdullah Almashwali
These cases were brought by the same DEA agent, John Rabaut. As Ars reported in April 2017, the two men—selling under the names "DarkApollo" and "Area51"—made key mistakes online that ultimately betrayed them. Those monikers advertised that they were directly importing heroin from Afghanistan.It was easy for Rabaut to find them. As he wrote:
Initial analysis of DARKAPOLLO and AREA51's public PGP key indicated that both keys were registered to the same email address: Adashc3l@gmail.com. A social-media search for the phrases Adashc3d31 and Adashc3d resulted in the discovery of a Twitter, Instagram, and Facebook account belonging to someone identified as "Ahmed Farooq" or "Ch. Ahmed Farooq" (Hereinafter referred to as FAROOQ). The Facebook profile belonging to FAROOQ indicated that he resided in Brooklyn, New York.
Both men pleaded guilty. Almashwali has already been sentenced to seven years in prison, while Farooq is scheduled to be sentenced in federal court in Fresno on January 22, 2018.
US v. William Farber et al.
As Ars reported last month, five men and one woman were connected to the AlphaBay account operating under the name "HumboldtFarms." Previously, one of the alleged male conspirators had apparently operated under the "PureFireMeds" account on Silk Road before that site was seized and closed down by law enforcement in October 2013.
On AlphaBay, which was taken down by federal investigators in July 2017, HumboldtFarms became "one of the largest vendors," authorities said in a statement.
The two primary suspects, William Farber and Bryan Lemons, both of Los Angeles, are charged with conspiracy to possess and distribute a controlled substance and conspiracy to launder money. Federal authorities believe that they used legitimate marijuana businesses as a way to launder millions of dollars in cash obtained through Bitcoin-fueled drug sales online.
All the defendants are also scheduled for a status conference in federal court in Fresno on October 30, 2017.
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